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Inheritance tax should be scrapped because it hurts too many middle-income families, a Conservative policy group has urged.

"Inheritance tax is not a popular tax," says the party's Economic Competitiveness Policy Group. "This has become even more true as the swift rise of house prices in much of the country has resulted in many people - who could not in any sense be described as rich - suddenly finding that their family will be liable to pay quite substantial amounts."

At present, homes worth more than £300,000 are liable for inheritance tax. If you are left a home worth more than that, you must pay 40% of any extra value.

Inheritance tax is thought to affect 40,000 families a year. And that figure can only go up with house prices. Just last month the Halifax said £300,000 was now the value of the average London home.